The Management Accounting Innovation - Example

Report on Management accounting Innovation has been one of the core themes driving modern organisations Type your name Type your course name Type your professor name No of words: 1967 Changes in the competitive environment have become imperative as organizations try to make adjustments so that they are able to deal with the different changes and have the required potential to be innovative and ensure sustainability (Danneels, 2002). Innovation in the field of management accounting is one of the contemporary issues which have developed new techniques in the field of management accounting which will help to deal with competition and ensure better drivers through which innovation in modern organization becomes possible (Jacobs, Johnston and Kotchetova, 2001). Innovation Management Accounting is a field which has developed recently and strengthened the field of general accounting and has brought innovation with regard to accounting, operations and management of innovation (Cavalluzzo and Ittner, 2004). This study thereby focuses on determining the manner in which management accounting innovation is one of the key drivers for development in the organization and the manner in which decision making gets affected. This will thereby help to stress on key objectives which will lead towards innovation management accounting and will concentrates on the different activities like cost oriented pricing, customer activities and so on. This will thereby help to understand the manner in which Innovation Management Accounting has acted as a key core theme through which organization is able to grow. Management accounting innovation has changed and developed in such a manner that it has its application for cost allocation concentration, target pricing focus, performance evaluation competency, customer profitability analysis, activity-based management capability and management control orientation. The wide variations which management accounting innovation provides ensures that an opportunity is created through which the organization will be able to take better decisions and ensure that the results are better. The fact that the above stated factors have a direct or indirect effect on the use of financial information, accounting competencies has thereby made it one of the most core competencies. Providing information related to different areas and dimensions have helped to bring changes and thereby ensured that the business decisions provide better results. A model which will help to understand the manner in which decisions gets enhanced and business is able to improve their efficiency can be understood from the resource-advantage theory. The resource-advantage theory was developed by Hunt and Madhavaram (2006) and has its relevance to the different fields like marketing, management, economics, law, business and different fields (Hunt & Davis, 2008). This theory suggest that organization which has abundance resources and are able to use the resources in the most effective manner are able to gain competitive advantage (Hunt & Madhavaram, 2008). The different type of resources which the organization has consists of human, financial, physical, legal, informational and others which when used in the correct manner provides better decisions. The management accounting process has provided an opportunity through which the business is able to use the different resources in such a manner that the overall decisions improve. The innovation management accounting provides an opportunity through which the different resources which comprises a useful component is decision making is used so that better practices, risk reduction strategies and efficiency enhancement methods can be used. The fact that innovation management accounting is being used in different fields and provides a decision based on all the factors ensures that the overall decisions is better and acts as a core constituent through which modern organizations are able to grow. Another model which will help to understand the manner in which innovation management accounting constitutes towards the development of the organization is contingency theory. This theory states that organizations which are structured and consistent in decision making by using the different evolving environmental factors are able to take competitive advantage by developing strategies which is aimed at superior performance (Armstrong, 2002). Innovation management accounting uses both the internal and external factors and based on it helps to develop a perspective which provides useful information on cost and performance. The entire process develops the traditional method and determines the different organizational factors which will influence decision making and will thereby provide the required directives through which better decisions are taken and the chances of achieving the goals maximizes (Chenhall, 2003). Innovation management accounting helps to provide useful information to the management executives which helps to support their decisions and enhances the effectiveness of decision making. With constant changes being witnessed in the field of innovation management accounting new accounting techniques helps the manager to develop better mechanism for decision making. The main activity of innovation management accounting is to convert the data into information which can be used by the organization for decision making and will provide an opportunity through which decisions will be better and can be verified (Baines and Langfield-Smith, 2003). Managerial accounting is essential both in the field of financial and accounting information which when used with the different techniques will help to drive the different factors through which the business becomes successful. Innovation management accounting serves as a useful tool through which the financial implications for the projects magnify and will provide an opportunity through which correct decisions will be made (Cavalluzzo and Ittner, 2004). The importance of innovation management accounting increases as it has its applicability in explaining the financial impact on the business decisions which are taken jointly. Using it as a tool will provide a competitive edge and increase the degree of competitiveness and help to analyze the decisions from different angels. This will thereby help to reduce risk which could otherwise arise as it will help to maximize the overall effectiveness in decisions making. The process of innovation management accounting aims at using different tools and mechanism which is aimed at aggregation, collection, allocation, analysis, evaluation, and control the operation process (Yeshmin and Hossan, 2011) through which the entire process of looking at different activities and managing the resources can be increased. The fact that innovation management accounting provides different dimensions through which innovation is ascertained and improvement in the process of decision making becomes possible thereby has ensured that it becomes the core constituent through which the chances of the organization being successful increases (Sulaiman and Mitchell, 2005). Innovation management accounting helps to develop a mechanism through which the correct price of the product or services can be determined so that the decisions which taken are better. Innovation management accounting concentrates on the different aspect of cost allocation and helps to determine the appropriate criteria based on which cost will be allocated to a particular product or services. This will thereby ensure that the correct cost centers are determined and will help to get the accurate cost (Lamminmaki and Drury, 2001). This will have an important implication for the managers as decisions which are taken will help the accountant to determine the correct cost for the product (Chan and Lee, 2003). Accurate cost estimation will help to improve the different decisions which are taken for the organization and will help to be a point of differentiation from the other players in the market. This will thereby help to develop the required dimensions through which the organization is able to generate the required benefits which will act as a method through which the organization is able to use the resources in the best possible manner. The method of cost allocation through the process of innovation management accounting ensures correct cost estimates which helps to accurately find out the profits for the business. This will determine the manner in which the organization will be able to use the resources correctly and will provide an opportunity through which the organization is able to deliver superior results (Byrne and Stower, 2008). The process ensures proper reporting standards and helps to develop a process which provides an opportunity to take decisions which can be relied on. The overall effetiveness of the process is such that it becomes the required transformation and provides the required imperative through which better business decisions are taken. The process of innovation management accounting increases the usefulness of the financial information as the report looks to disclose different information which will be helpful for decision making for the different stakeholders (Lee, Lin and Chen, C2010). The overall effectiveness of the decisions will improve as it will assist the managers to take different decisions pertaining to different directions and will have a significant impact on the process through which decisions are taken. This will thereby help to provide a different angle and bring the required transformation through which maximum effectiveness will be achieved and the decisions which are taken will be better and useful. The overall use of innovation management accounting will help to identify the key components which will contribute positively towards decision making especially in the competitive environment. This will help to understand, manage and utilize the manner in which different innovation management accounting techniques will be used and provide better decisions. The overall model will concentrate on the business operations and help in valuable decisions through which variations can be made and the overall effectiveness can be measured. The process will thereby entail towards developing a process which is at maximizing business excellence, corporate performance, competitive advantage, organizational growth, and sustainability through which a competitive edge will be provided and will help to use the different resources in the most positive manner. To ensure that the process of innovation management accounting provides maximum benefits to the business the executives have to concentrate on providing the required guidance which will ensure effectiveness and will provide the required opportunity through which new opportunities are created in the competitive market (Hunt and Davis, 2008). This will act as a point of difference between others and will help to develop the required developments through which better services and standards will be provided. Providing information related to different areas and dimensions have helped to bring changes and thereby ensured that the business decisions provide better results. The overall effectiveness will thereby be improved and bring the required changes through which innovation takes place and the organization is able to transform the style of carrying out business. Innovation management accounting is a tool which is being widely used and helps organizations to maximizing business excellence, corporate performance, competitive advantage, organizational growth, and sustainability. This thereby develops a process through which the organization is able to bring the required change and ensure differentiation through which business becomes successful. Using it as a tool will provide a competitive edge and increase the degree of competitiveness and help to analyze the decisions from different angels. This will thereby help to reduce risk which could otherwise arise as it will help to maximize the overall effectiveness in decisions making. This will help to ensure that the process of innovation management accounting provides the required impetus and direction through which differentiation is ensured when compared to competitors. The management accounting process has provided an opportunity through which the business is able to use the different resources in such a manner that the overall decisions improve. The innovation management accounting provides an opportunity through which the different resources which comprises a useful component is decision making is used so that better practices, risk reduction strategies and efficiency enhancement methods can be used. This will thereby help to develop the entire process through which innovation management accounting provides an opportunity to differentiate the style of work and will act as one of the core constituent through which the organization is able to perform better. This will act as a method through which better results are achieved and the organization will be able to bring the required transformation and ensure that the business is able to gain by using the resources in the effective manner. This will thereby contribute towards the success of the business and will act as a method through which the organization will be able to gain a competitive edge. References Armstrong, P., (2002). The Costs of Activity-Based management. Accounting, Organizations and Society, 27, 99-120 Baines, A. and K. Langfield-Smith, (2003). Antecedents to management accounting change: a structural equation approach. Accounting Organizations and Society. 28, 675-698 Byrne, S. and E. Stower, (2009). Activity Based Costing Implementation Success in Australia, 2008. July 9 Cavalluzzo, K. S. and Ittner, C. D., (2004). Implementing Performance Measurement Innovation: Evidence from Government. Accounting Organizations and Society. 29, 243-267 Chenhall, R. H., (2003). Management Control Systems Design Within is Organizational Context: Findings From contingency-Based research and Directions For the Future. Accounting, organizations and Society, 28, 127-168 Chan, S. Y. and Lee, D. S., (2003). 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